Edited by China Merchants: food and Beverage: the Ivy of Research and Investment

Introduction: food is the most important thing for the people, and the food and beverage industry is one of the most mundane industries with investment in Changchun. Food and beverage research does not need a very professional background, but it can contain huge value investment opportunities, so which are the points that we need to focus on in the food industry research?

1. Classic classification of food and beverage-- high-end vs public, negative vs positive type

The atlas of food and beverage industry mainly analyzes food and beverage companies from three aspects: product power, brand power and channel power, and puts forward four principles of high elasticity of products.The public is not as good as the high end, the food is not as good as the drink, the big one is not as good as the small one, and the Yin type is not as good as the Yang type.Starting from the power of the product, the product is divided into four quadrants according to high-end / mass, yin / yang. Different categories of products need to find different value support, need different operation models, so there are different development processes, and lead to different investment models.

From the point of view of product expansion space and speedIt is easy to give birth to cattle stocks.It needs to have the characteristics of easy expansion and scale effect.Negative products (low-temperature milk, low-temperature meat, beer) sales radius is small, it is difficult to become bigger and stronger, positive products (medium and high-end liquor, baby milk powder, health products) is easy to achieve national sales, highly expansionary, is the first choice of enterprises.

2, the new trend of the industry-- the rise of consumers' right to speak.

In the era of material surplus, channel hegemony returns to the product core, which is the biggest change in the food and beverage industry.In the past, it was a shortage economy, and for enterprises, the most important thing was the channel, as long as the products were sold, they could be sold. Now the product category is extremely rich, food and beverage has entered the era of surplus, how to highlight the product power has new requirements, brand strength requires more accurate marketing.

There were three stages of consumer goods in the past:

• Brand strength is the main stage:It represents the stage from 1988 to 2008, represented by Coca-Cola Company and Procter & Gamble Co, mainly by national media such as CCTV and satellite TV.

• Channel power is the main stage:Deep distribution and direct control channels represent the stage from 2003 to the present, and those who have done best in this respect are Golden Dragon Fish and Master Kang.

• The stage of giving priority to product power:On behalf of 2013 and the future stage, many traditional food and beverages have reached the peak of development, and the channel model has also gone to the extreme. Only by constantly improving product innovation and sticking consumers with product strength can we open a new sky.

3. The essence of the product-necessities

Products have always been the most important medium of communication between enterprises and consumers. The nature and rules of the product are as follows:

Necessities

• Necessities: representative products include rice noodles, grain, oil, meat, eggs and milk. The products are characterized by rigid consumer demand, minimal product differences, short processing links, large agricultural products, weak consumer adhesion to brands, and easy terminal interception.

• Addiction: there are some functions or elements in the product, so that consumers can not stop, will continue to repeat purchases, addictive attributes help enterprises to solve the problem of consumer repurchase rate.

• Social goods: most of the consumption of products is social behavior, with the characteristics of showing value, the price tag and brand label of the product is particularly critical, which makes the product price insensitive or even positively correlated, and rising prices stimulate an increase in consumption. Such as Maotai, Swiss watches and even Starbucks Corp.

• Belief: a higher level. Such as Jobs' Apple Inc mobile phone, his minimalism and personality charm are poured into the mobile phone.

Belief, social and addiction are good business models that are more valuable than necessitiesThe core is to solve the repurchase rate and price sensitivity of consumers.

4, product life cycle-addiction resolution repurchase rate

Addiction is more basic.Products with addictive properties solve the problem of consumers' repurchase rate.Which greatly prolongs the life cycle of the product.

• Fermented products generally contain a unique flavor, which can not be simulated and copied by human beings, and the stickiness of taste makes the product life cycle longer.

Fermentation process is a process of microbial saccharification-alcoholization or acidification-esterification, which can not be replicated artificially. The flavor of fermented products is very different, which can bring unique flavor and taste barriers.

• The product has functionality, which is better than no functionality.

The life cycle of the beverage is relatively short, there is more competition, and it is better for the product to have some functionality. Such as Red Bull, taurine and caffeine were added to solve the fatigue problem; Wang Laoji added honeysuckle and Prunella vulgaris to solve the fire problem. The negative examples are Xiao Ming and Hai Zhi Yan.

• The short-term explosive power of online celebrity products should not be underestimated, but the medium-term vitality should be lowered.

Online celebrity products attract corporate resources and energy, causing blind optimism. If the product cycle goes to the end and there is no consumer repurchase, enterprises will usually be dragged down by the new production capacity, and investors are easy to buy at the high point.

• The health of the product is the premise of the spring of the product.

5, valuation system-why can Haitian's valuation exceed Maotai?

The condiment has performed very well in the market this year.The core of the high valuation given by condiments is that the industry has the highest certainty of sustainable growth.。

In the industry valuation system, the absolute valuation level will fluctuate under the influence of liquidity and performance growth, but the flow of funds is essentially a comparison of the performance-to-price ratio of all kinds of assets, so there is valuation ranking in each sub-industry. Starting from the product attributes and business model, the valuation system of food and beverage has no absolute value, but there is an order:

Condiment > spirit > dairy industry > snack food > meat products

Why condiments can give the highest valuation, because you can use DCF (discounted cash flow method) to estimate 20 years or more, do not need to worry about large fluctuations in the middle, seasoning repurchase rate is high, and the taste of the brand is very sticky, because the user of the condiment is the cook, the buyer and the user are separate, somewhat similar to the relationship between pharmaceutical companies and doctors.

Liquor is slightly lower than condiments, mainly because the increment space of the industry is less than that of condiments, and it is more affected by economic fluctuations. However, the ultra-high ROE of liquor and the taste stickiness brought by fermentation process make liquor also worthy of high valuation.

Finally, the increment space of meat products is limited and the upstream cost fluctuates greatly.

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